Banking AI: The New Face of Money Management

The advent of mobile banking has inspired many changes within the banking industry. Millennials rely heavily on mobile banking, and some of the larger banks have invented ways to both engage and help this demographic with their finances.

As the population has become accustomed to voice recognition assistants and predictive messaging, financial institutions have leveraged this technology to attract customers who enjoy this convenience. AI-powered mobile banking apps offer a personalized experience for the user and can go as far as helping customers plan and budget their money.

Advantages for Everyone

Mobile banking apps have evolved for two reasons: visits to bank storefronts are down by about 30% since 2017 and the use of banking apps has been up by about the same amount since 20161. These usage statistics made it clear to the banking industry that the AI they used within their own technology space could help them enhance their customer’s mobile experience.

Also, the bank could immensely benefit while helping their customers.

Some ways banks benefit from mobile AI and predictive analytics are as follows:

Constant availability by allowing users to access their accounts and perform transactions at their own convenience;

Personalized services and user experience through the use of bank analytics. The more the bank knows about the user, the more the user enjoys customized insights;

Increased security through features such as two-factor authorization and biometric data. Combined with high-level encryption, a mobile user can use their app free of worries; and

Immediate notification of information or offers they can take advantage of.

Digital Assistants

In 2018, Bank of America launched a digital banking assistant called Erica. Erica is similar to Siri and Alexa except that she only performs banking tasks. Erica helps BOA customers transfer money, warns them of low balances, offers individual financial advice. Erica can also respond to specific queries, like calculating how much you spent at Target last month or tallying your debit transactions.

Last year, Wells Fargo presented its customers with a banking feature that warned them if they didn’t have enough to pay an upcoming bill and quizzed them about how much they’d spent at the grocery store.

Speaking of Alexa

Alexa is Amazon’s cloud-based virtual assistant that responds to voice commands. Some credit unions have enabled some Alexa skills to generate branch locations and routing numbers. A few have enabled more personal data such as access to account information. Older customers have concerns about the security and privacy of these services, but some studies show that younger users are more open to using services like Alexa and Google home for banking.

What’s Next?

Banking automation and AI will play a major role in future banking functions. Virtual agents and additional predictive capabilities will continue to advance and increased data collection is sure to inform how banks progress with their customer service. The significant ROI and continued customer retention prove that predictive analytics is here to stay.